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March 2005
Getting ready for April 15 will be a piece of cake if you had
a system in place last year. What system you say? “Today’s
mail is tomorrow’s pile™” is a reality check.
While you can’t undo the disarray piled up from last year,
you can begin to practice dealing with paper in a more effective
way for 2005.
• Designate a specific, accessible place to collect tax
related information. Make sure others in your household or business
are aware of this location. The Paper Tiger filing system will
reduce the pain you feel at tax time.
• Take advantage of electronic bill payments. This means
less check writing, and the transaction will be reflected in your
monthly bank statement—an important document to support
your tax return.
• Use software to manage your financial information, such
as Quicken (for personal and small businesses) or Quickbooks,
which has additional applications for business. If the road to
the tax man was paved with good intentions, but your software
has become shelfware, contact your CPA who may have a staff person
who can set up the system for you. Having all the latest and greatest
tools is one thing; putting them to use will make the difference.
• Keep bills to pay in one spot. A tickler file works great
for this.
• Store paid bills that relate to your taxes in an accordion
file by month.
• If you use a professional tax person and don’t have
an appointment scheduled, do it as soon as you finish reading
this email. Need a referral? Call 925.933.9737 for the names of
several CPA’s that I recommend.
Credit cards: This is such a neglected aspect of many people’s
tax information, that it warrants special mention.
• Use one credit card for personal transactions, and another
for business.
• Mingling is great at social events, but not with your
finances. Maintain separate bank accounts for personal and business.
• Designate one place to dump credit card receipts for each
credit card. As charges are incurred, make it a practice to drop
receipts in one consistent spot. Cancelled check files make great
receipt catchers.
• When the monthly charge statement arrives, open it and
match receipts with the statement. Staple the receipts to the
statement and file in the monthly paid file. Bonus: Reviewing
your statements each month is one way to protect yourself from
identity theft.
• At the end of the year, simply move the monthly records
to a box or envelope (I like plastic envelopes for durability)
keeping all supporting tax documents with your return.
With a few disciplined habits, you can make tax time less stressful.
Plus, you’ll save money by being able to take more deductions.
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